Charges will no longer be registered with ASIC. The mechanism for registering charges on the Register has not yet been publicised but the types of charges to be registered will include: fixed and floating charges, chattel mortgages, conditional sale agreements, retention of title clauses, hire purchase agreements, consignments, assignments or transfers of title, bills of sale and certain financial instruments.
What are the implications for you?
If you –
- provide credit as part of your terms of trade and seek to rely on a retention of title clause; and/or
- lease, lend or rent goods,
then YOU ARE AT RISK in a way that YOU have not previously faced.
To illustrate the point – If your business leases a piece of equipment to a customer who then becomes insolvent, you may find yourself in a position where you lose your rights in that equipment to a liquidator or trustee if you have not registered your interest on the Register.
What you need to do
It is vital that all businesses investigate whether or not your lease agreements, and other commercial securities and charges, will be impacted by the PPSA and ensure that there are proper procedures in place to ensure compliance with its requirements.
Failure to be prepared for this new legislation could have serious implications for your business. Therefore, you need to investigate whether or not you will be impacted by this legislation and put proper procedures in place to ensure compliance with the requirements.
For more information
Redchip has developed a number of resources to help our clients through the transition phase of this new legislation, including self assessment check lists.
If you are concerned or wish to obtain further information please contact Helena Mrmos from our PPSA team on 07 3223 6100 for a confidential and obligation-free discussion.